Immigration news and insights provided by Paul Szeto LLC - a former INS attorney and an experienced immigration practitioner - who can be reached at 732-632-9888, http://www.1visa1.com/ (All information is not legal advice and is subject to change without prior notice.)

A blog about U.S. immigration matters by Paul Szeto, a former INS attorney and an experienced immigration attorney and counsel. Contact Info: 732-632-9888,http://www.1visa1.com/(All information is not legal advice and is subject to change without prior notice.)

Tuesday, July 31, 2012

L-1 Multinational Transferee Visa Company Relationship

By Paul Szeto, Esq.

The L-1 visa category is a very popular tool
for foreign companies to transfer executives and high level managers to the
United States
to work for an existing office or to start a new comany.One of the basic requirements of the L-1
visa is that there must
be a qualifying relationship between the business entity in the United States
and the foreign operation which employs the alien abroad.The transferee must have been employed abroad
by the foreign operation for at least one of the last three years in a
managerial, executive, or specialized knowledge capacity.Further, while the L-1 executive or manager
is working in the United States as an L-1 visa transferee, the petitioner must
continue to do business both in the United States and in at least one other
country, either directly or through a parent, branch, subsidiary, or affiliate.

The petitioning company must produce documents to prove that the
required corporate relationship exists between the U.S. business entity and the
foreign operation.Some business
relationship is quite simple to define, while others may require extensive documentation and
detailed explanation to prove. For example, when an international bank based in Taiwan
is transferring a manager to work in their New York branch, the business relationship
is not difficult to prove.Corporate
documents and filings with the State and Federal banking authorities can be
used to prove the relationship between the branch and the parent bank in Taiwan.

The relationship
between a parent entity and a subsidiary can be tricky.The regulations define a parent as a legal
entity that owns, directly or indirectly, more than half of the ownership interests of another business entity, and controls that
entity.In the
situation where the parent owns exactly 50% of the other entity in a 50-50 joint venture and
has equal control and veto power over the entity, then the required parent-subsidiary relationship also exists.Finally, even if the parent entity owns less than half of the subsidiary entity, the relationship is still valid to
support an L-1 petition if it can be proved that in fact the parent controls the subsidiary entity.

Sometimes, a transferee did not work for the parent
or subsidiary but worked for “sister companies” that are related in some way to the U.S. company. The regulations also allow affiliated
companies or “affiliates” to petition and transfer employees under theL-1 visa program.The regulations define “affiliates” in three
ways.First, they can be subsidiaries both of
which are owned and controlled by the same parent or individual.In this situation, a Chinese
parent company can have two subsidiaries, one in Hong Kong and the other in the
United States.If an employee was working in Hong Kong as an
executive during the past three years, the company can transfer him or her to
the U.S.
subsidiary by means of the L-1 visa. Secondly, these legal entities can be owned and controlled by the same group of individuals, each
individual owning and controlling approximately the same number of shares or proportion of each entity.For example, a group of
investors who own a company in England and also another one in the United
States, and decided to transfer an executive from England to America. As long
as their ownership shares are approximately in the same proportion in both
companies, an L-1 petition can be filed to transfer the executive to the United States.

Finally, partnerships in the United States and their international counterparts organizedto provide accounting
services along with managerial and/or consulting services that market their
accounting services under an internationally recognized name under an agreement
with a worldwide coordinating organization are also considered
valid affiliate for the purposes of the L-1 visa. These are typically big
accounting firms providing accounting and consulting services to clients.Many of them are also eligible to file
blanket L-1 petitions for multiple transferee employees.

In sum, in order for an L-1 visa petition to be approved, the petitioner
must prove that a valid corporate relationship exists between the U.S.
company and the foreign operation.Documents such as articles of incorporation, stock certificates, bylaws,
minutes of shareholder meetings, corporate tax returns, etc., can be used to
prove the existence of the relationship.